UK trade disrupted by volcano in April

Britain's trade deficit was broadly unchanged in April, during a month in
which trade was disrupted by the volcanic eruption in Iceland.

UK trade disrupted by volcano in April Photo: PHOTOSHOT

By Angela Monaghan

6:00AM BST 10 Jun 2010

The trade in goods deficit rose slightly to £7.28bn, from £7.26bn in April, after imports fell by 0.4pc to £28.6bn, and exports slipped 0.6pc to £21.3bn.

The Office for National Statistics said it was impossible to estimate the exact impact of the volanic ash cloud on imports and exports. It said that non-EU trade was likely to have been more affected than EU trade, because a greater proportion of goods were transported by air to those countries.

Economists had forecast a modest narrowing of the goods deficit in April, to £7bn. However, some said that the underlying picture from the data was a positive one, with exports rising 1.8pc when oil and other erratic items were stripped out. Imports on the same measure fell by 1.8pc.

It is hoped that growth in exports, boosted by a weak pound, will help drive the UK's economic recovery by making British goods cheaper abroad.

"Given the pressures on domestic demand - with consumers still going through a balance-sheet adjustment and deep public sector cuts on the horizon – exports remain key to a strong and sustainable UK recovery," said Andrew Goodwin, senior economic adviser to Ernst & Young's ITEM Club. "The ance in that regard."